It is generally known to provide a transfer case-like device that will allow conversion of a two-wheel drive (2WD) vehicle equipped with a gasoline engine into what is known as a “Plug-in Hybrid Electric Vehicle”, or PHEV vehicle. This power transfer system includes two power inputs, one power output, and one clutch mechanism moveable between an engaged position and a disengaged position. One power input interfaces with the transmission (e.g. receives power from engine). The other power input interfaces with an electric motor. The power output interfaces with a drive shaft and provides torque to the wheels. A chain and two sprockets deliver power from the electric motor to the power output shaft. This power transfer system allows the rear power output shaft (i.e., the wheels) to be coupled and decoupled from the engine/transmission through a clutch mechanism. It allows the rear power output shaft (i.e. the wheels) to be driven via the electric motor. It also allows the wheels to be driven by both the gas engine and the electric motor. The clutch can couple and decouple the engine/transmission from the output shaft. However, the output shaft is always connected to the electric motor through the power transfer system, thus causing the design to operate less efficiently when operating in gas mode, in other words, the electric motor is always driven by the output shaft through the chain and sprockets and finally through the electric motor power input shaft.